Federal Reserve takes aggressive position on non-US banks - .PDF file.
The board of governors of the Federal Reserve System recently issued a final rule that will fundamentally change the way in which non-US banks are regulated and supervised in the US.
Pursuant to section 165 of the Dodd-Frank Act, the Federal Reserve has issued regulations for the enhanced prudential supervision of large bank holding companies (i.e. those that hold $50bn or more of total consolidated assets). Section 165 applies generally to covered financial institutions regardless of where they are organised, but the Federal Reserve has decided to apply its provisions to non-US banks much more aggressively than its manner of supervising foreign banks in the past.
In particular, every non-US bank with a substantial presence in the US (i.e. those that hold $50bn or more of total US assets, not including assets held in US branches and agencies) will be required to establish an intermediate holding company (IHC) to hold its US-based banking and non-banking subsidiaries…
Click on the link below to read the rest of the Allen & Overy briefing.